Ravensource Fund, an investment management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. Ravensource Fund’s (“Ravensource” or the “Fund”) net asset value (“NAV”) per unit increased by 11.9% over 2021, including distributions received by investors. As the fund invests in underfollowed and unloved opportunities, Ravensource’s investments can be particularly exposed to temporary market losses during flights to quality. Try to spend some time taking a look at the fund’s top 5 holdings to be informed about their best picks for 2022.
In its Q4 2021 investor letter, Ravensource Fund mentioned Brookfield DTLA Fund Office Trust Investor Inc. (NYSE:DTLA-P) and explained its insights for the company. Founded in 2013, Brookfield DTLA Fund Office Trust Investor Inc. (NYSE:DTLA-P) is a US-based real estate investment trust company. Brookfield DTLA Fund Office Trust Investor Inc. (NYSE:DTLA-P) delivered a -16.74% return since the beginning of the year, while its 12-month returns are down by -25.24%. The stock closed at $10.99 per share on April 14, 2022.
Here is what Ravensource Fund has to say about Brookfield DTLA Fund Office Trust Investor Inc. (NYSE:DTLA-P) in its Q4 2021 investor letter:
“Brookfield DTLA owns six class A office properties and one retail property in the downtown core of Los Angeles. It was formed and is managed by one of the preeminent and savviest real estate investors in the world — and that’s not just our patriotism talking. Brookfield created the entity to take advantage of what they believed would be a broad-based revitalization of the downtown Los Angeles district. To do so, they acquired several assets from an insolvent real estate trust by exchanging new Brookfield DTLA preferred shares for ones of the insolvent trust.
As with many of Brookfield’s investments, the capital structure is highly complex; however, it is clear these preferred shares hold a critical place in it. Absent a negotiated deal, Brookfield cannot realize on any of its common equity value until these preferred shares are paid their full economic claim. As Brookfield has not paid cash dividends on these preferred shares, this claim has accreted to $47.85 per $25.00 face value as of December 31, 2021.
We have been watching these preferred shares keenly for several years. Following the uncertainty COVID brought to office space occupancy, the preferred shares fell below $15.00 per $25.00 face value. We believed the risk / reward to be highly attractive and invested. Like other similar capital structure opportunities, e.g. Dundee, a successful result will require time and our direct engagement with other preferred investors and Brookfield itself. In the meanwhile, we firmly believe there is sufficient asset value to cover the full claim of the preferred shares, supported by recent bank refinancings of the asset level debt.”
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Our calculations show that Brookfield DTLA Fund Office Trust Investor Inc. (NYSE:DTLA-P) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Brookfield DTLA Fund Office Trust Investor Inc. (NYSE:DTLA-P) delivered a -4.43% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.
Disclosure: None. This article is originally published at Insider Monkey.